If accepted by the Tempe City Council, Tempe would become the second Arizona city, after Tucson, to pursue a modern streetcar operation.

The city has considered both an extension of Valley Metro’s light rail line, and also Bus Rapid Transit, but funding for both options is not in place due in part to lower sales tax revenue caused by recession, according to Valley Metro Rail Project Development Director Wulf Grote. Financial constraints are affecting the streetcar option as well, but so far has delayed plans for completion by only one year (from 2015 to 2016).

Supporters hope to tap regional tax revenue and federal funds from the Small Starts program overseen by the Federal Transit Administration, Grote said. Small Starts could provide $75 million, or about 46%, of the $162 million estimated initial cost of the project.

Operating costs for the line are estimated at $3.1 million per year. But planners believe the benefit to the city’s economy would be about 1.3 times the cost, Grote said.